Political and Economic Life, 1905-19

Tisza directed the Liberal government until 1890, and for fourteen years thereafter a number of Liberal prime ministers held office. Agricultural decline continued, and the bureaucracy could no longer absorb all of the pauperized lesser nobles and educated people who could not find work elsewhere. This group gave its political support to the Party of Independence and the Party of Forty-Eight, which became part of the "national" opposition that forced a coalition with the Liberals in 1905. The Party of Independence resigned itself to the existence of the Dual Monarchy and sought to enhance Hungary's position within it; the Party of Forty-Eight, however, deplored the Compromise of 1867, argued that Hungary remained an Austrian colony, and pushed for formation of a Hungarian national bank and an independent customs zone.

Franz Joseph refused to appoint members of the coalition to the government until they renounced their demands for concessions from Austria concerning the military. When the coalition finally gained power in 1906, the leaders retreated from their opposition to the compromise of 1867 and followed the Liberal Party's economic policies. Istvan Tisza--Kalman Tisza's son and prime minister from 1903 to 1905--formed the new Party of Work, which in 1910 won a large majority in the parliament. Tisza became prime minister for a second time in 1912 after labor strife erupted over an unsuccessful attempt to expand voting rights.